The teaching is organized as follows:

Learning outcomes

The course introduces students to accounting and provides knowledge on to the preparation, composition, reading and analysis of wineries financial statement according to international standards. The course considers also costs analysis and evaluation and sustainability measurements for wineries. The objective is to provide students with the principles guiding the analysis of investments in the various activities of the wine-production sector. The teaching is developed from the teaching of the principal topics in financial maths (simple and compounded interest, discounting, present value calculation of different capital flows, periodicities, and capitalisation). Each of the topics is contextualised to the wine-production sector (hanging fruit valuation, vineyard cycle, circulating capital, etc.). The course proceeds also with the introduction to the concepts of risk and uncertainty in the returns from investments in the firm and outside the firm, to diversify risk. Various risk profiles from investment and portfolio composition techniques are discussed for various forms of wine-production firms, depending on the output market, production structure, and forms of competition. Students will be exposed to a review of the various financial products (shares, bonds, and securities) focussing on the difference between market and subjective valuations. Rural estate appraisal concepts will also be covered, such as market value and its determinants, change value and substitute value.

Program

------------------------ MM: INVESTMENT ANALYSIS AND APPRAISAL IN THE WINE BUSINESS ------------------------ 1. Introduction to the course content and its organisation. History and evolution of the discipline, foundation concepts and links to economics. 2. Introduction to basic elements of financial mathematics and their use in computing the discount and preset value of future income and values., 3. Differences between savings and investments, with examples from the wine business. 4. Handling of flows in costs and revenues, intermediate time accumulations, initial and final accumulations (present value), reintegration rates, annuities and poli-annuities (limited and illimited). 5. Determinants of interest rates, real and nominal rates. 6. Uncertainty in investment plans and its formal representation with subjective and objective probabilities. 7. Identification and valuation of the returns to investments, labour saving technologies. 8. Vineyard investment analysis: temporal distributions of costs and revenues, optimal age of vineyard substitution. 9. Investment analysis for wine ageing and bottling. 10. Investment criteria from different perspectives: financial, social and familiar. 11. Investment portfolio management, objective and subjective valuation of financial products. 12. Risk management via private and publicly subsidised hail insurance. 13. Group task: risk simulation with and without subjective probabilities. 14. Market value of vineyard and vertically integrated wine making facilities. 15. Investment analysis on reputation of single firm and of collective district of production. 16. International case studies. 17. Computation practicals with R (via R-Studio & R-Markdown) and MS-Excel ------------------------ MM: FINANCIAL STATEMENT ANALYSIS AND PLANNING ------------------------ 1. Financial and Managerial Accounting + stakeholder perspective 2. Analyzing and Recording Business Transactions 3. Adjusting the Accounts 4. Foundations of Financial Reporting 5. Inventory and depreciation 6. IAS 41 – the accounting treatment for biological assets 7. Income Statement 8. Financial statement analysis 9. Sources of Finance 10. Managerial Accounting and Cost Concepts 11. Activity-Based Costing 12. Costing Systems: Job Order Costing 13. Measuring Sustainability in wineries

Bibliography

Examination Methods

Students will be assessed on the basis of their contribution teamwork, participation during the class debates and with a final written and possibly oral exam.